Leaders discuss business, economic outlook

Hundreds of Orange County business leaders voted Friday on the United States' long-term options to reduce debt.

From the Irvine Marriott's ballroom, UC Irvine Paul Merage School of Business Dean Andy Policano conducted an informal straw poll.

A fair number of hands went up for reducing U.S. mail service by one or two days. A smattering were raised for reducing farm subsidies or limiting tax deduction. Fewer still appeared for decreasing defense spending or Medicare benefits.

"So I think we're just basically going to kill the Postal Service," Policano said. "But at least you can see how difficult these decisions are in Congress."

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From the trillion dollar coin, to the fiscal cliff and debt ceiling debate, Policano gave the room a primer on how national policy affects business down to a local level.

He and Marci Rossell, former chief economist for CNBC, headlined the Irvine Chamber of Commerce and Merage School's annual Business Outlook Breakfast.

Despite some Congress-bashing, the prognosis through most of the two-hour event was largely sunny.

"The county's unemployment rate at 6.8% is the lowest of any major metropolitan market in California," Orange County Register Vice President Steve Churm said to introduce the program. "Orange County remains one of the true bright spots in this great state when it comes to jobs and accelerating economic activity.

"But the big, big elephant in this spacious ballroom this morning is whether our positive fortune here in Orange County will continue? Or will factors near and far derail this slow and methodical recovery?"

Rossell answered that with a simple bottom line.

"The recovery of the U.S. economy, it occurred last year," she said.

"From what defines an economic recovery from an economist's point of view, recovery happened in 2012. 2013 is the year we start to really feel it though," she said, pointing to employment and housing lagging behind other economic indicators.

She also tried to refute the idea of China as a Boogeyman, saying its imports from the U.S. have gone from $2 billion to $20 billion in the last 10 years.

"All this talk about China being the world's largest economy, that should not keep a soul up at night," she said, telling the room that China's income per-person is still incomparable to the U.S.

But as those incomes rise in 2013 and beyond, Rossell said they should be embraced as a new export market.

"I want everybody in this room to sell them something," she said. "Isn't that what you ought to be thinking about?"

After the program wrapped up, Rossell and Policano settled in to answer some audience questions.

When they were immediately asked how the rest of the nation views Southern California, its business climate and tax code, Rossell answered, "I think California is like a really good looking woman. You'll put up with a lot of crazy won't you?"